Blog
Despite Anthem and Sony, agents still struggle to sell cyber
And while many business heads have expressed interest in insurance options to mitigate potential fallout from an attack, independent insurance agents report that cyber liability insurance is still a difficult sell.
John Tiene, who represents thousands of agents in the Northeastern US as CEO of Agency Network Exchange (ANE), says small business are especially hesitant to purchase the important policy.
“The demand [for cyber] is increasing, but not at a rate we think is quick enough,” Tiene told Insurance Business America. “Small businesses are still very reluctant to sign up for the coverage and that really concerns us because some 30% of breaches occur in these small companies with fewer than 250 employees.”
The reason is not pricing, which is currently experiencing downward pressure among low-risk classes. It is an education gap; because small businesses do not recognize their own exposure, many feel cyber insurance is a superfluous purchase.
That should represent a clear call to agents, Tiene says.
“Our job is really to educate the business owner as to the variety of exposures they are presented with and help them understand how the coverage can protect them,” he said.
Carriers with superior products help in this effort by offering education to both agents and business owners alongside their policies. Tiene says it is currently the larger carriers that offer these services, along with more sophisticated products that can be specialized for larger clients.
Most important is ensuring agents are sufficiently comfortable with the cyber product to discuss it with clients. Going forward, failure to discuss cyber protection could be a major E&O exposure for independents.
“This should now be a standard conversation with clients because every client has the exposure at some level. A breach may only cost a client $10,000 to $30,000, but for a small business client, that is a lot of money,” said Tiene. “They may turn to the agent and say, ‘Why didn’t you talk to me about this?’
“This is a coverage need of the 21st century.”
Archives
- October 2020 (1)
- September 2020 (1)
- March 2020 (1)
- February 2020 (2)
- January 2020 (1)
- December 2019 (1)
- November 2019 (2)
- October 2019 (3)
- September 2019 (1)
- August 2019 (1)
- July 2019 (2)
- June 2019 (1)
- February 2019 (1)
- January 2019 (17)
- December 2018 (3)
- November 2018 (13)
- September 2018 (2)
- August 2018 (2)
- May 2018 (1)
- November 2017 (1)
- March 2017 (1)
- October 2016 (1)
- August 2016 (2)
- July 2016 (2)
- June 2016 (5)
- May 2016 (8)
- April 2016 (1)
- March 2016 (2)
- January 2016 (2)
- December 2015 (2)
- November 2015 (1)
- October 2015 (1)
- September 2015 (2)
- July 2015 (2)
- June 2015 (5)
- April 2015 (9)
- March 2015 (35)
- February 2015 (28)
- January 2015 (50)
- December 2014 (10)
- October 2014 (8)